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ISCR Case 20-03191 — CASE

ISCR Case 20-03191granted

Case Headnote

ISCR Case No. 20-03191

grantedJul 25, 2022· Hon. Candace Le'i Garcia· hearing

Summary

A 50-year-old maintenance worker was granted a security clearance despite concerns under Guideline F (Financial Considerations) stemming from multiple delinquent debts. The applicant faced allegations of 10 delinquent consumer debts totaling $26,628, two delinquent medical debts totaling $2,387, and several charged-off accounts including an auto loan for $10,370, credit cards for $1,374, $782, and $717, and retail accounts for $230 and $613. Additionally, there were collection accounts for $1,455, $1,258, $965, and $932.

The administrative judge determined that the applicant's financial difficulties were largely due to circumstances beyond her control, specifically low income and high living costs. Mitigating conditions were applied, acknowledging that the conditions were not caused by the applicant and that she had initiated a good-faith effort to resolve the issues.

The applicant demonstrated a commitment to resolving her debts through a debt relief program and provided documentation of her efforts to address her financial obligations. Based on these factors, the security clearance was granted.

Why the Applicant Prevailed

The applicant demonstrated a commitment to resolving her debts through a debt relief program.
Financial issues were largely due to circumstances beyond her control, such as low income and high living costs.
The applicant provided documentation of her efforts to address her financial obligations.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control
AG ¶ 20(d)appliedThe Individual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts

Key Rule Quoted

“A security clearance adjudication is an evaluation of an individual’s judgment, reliability, and trustworthiness. It is not a debt-collection procedure.”

Procedural Posture

SOR issuedMar 24, 2021
Answer filedJul 29, 2021Applicant elected to have her case decided on the written record.
Hearing held—Decision made based on written record.
Decision dateJul 25, 2022

Cite For

Mitigation of Financial Concerns Under Guideline F
Impact of Circumstances Beyond Control on Financial Obligations
Good-faith Efforts in Debt Resolution as a Mitigating Factor

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: Decision on RecordDecided: granted

The judge found that the applicant had multiple delinquent debts totaling over $26,000, including charged-off credit cards and medical debts. However, the applicant successfully mitigated the financial concerns by demonstrating a good-faith effort to resolve her debts through a debt relief program and by providing evidence of her financial circumstances.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant had 10 delinquent consumer debts totaling $26,628 and two delinquent medical debts totaling $2,387. $26,628	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.b	Applicant had a $10,370 charged-off auto loan. $10,370	For Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.c	Applicant had a $1,455 medical debt placed for collection. $1,455	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.d	Applicant had a $1,374 charged-off credit card. $1,374	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.e	Applicant had a $1,258 collection account. $1,258	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.f	Applicant had a $965 collection account. $965	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.g	Applicant had a $932 medical debt placed for collection. $932	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.h	Applicant had a $782 charged-off credit card. $782	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.i	Applicant had a $717 charged-off credit card. $717	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.j	Applicant had a $230 charged-off account used for catalog purchases. $230	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.k	Applicant had a $931 charged-off account, a duplicate of another debt. $931	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other
1.l	Applicant had a $613 charged-off retail credit account used for catalog purchases. $613	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	Claimed Other

Descriptive standardized rendering of a decided public case (Guideline F). The verbatim source decision is shown in full below.

Full decision

The complete, official text — footnotes and signatures included — is in the original PDF.

Decision text, by section

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

______________ ______________ DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) ) ISCR Case No. 20-03191 ) Applicant for Security Clearance ) Appearances For Government: Raashid S. Williams, Esq., Department Counsel For Applicant: Pro se 07/25/2022

STATEMENT OF CASE

GARCIA, Candace Le’i, Administrative Judge: Applicant mitigated the financial considerations security concerns. Eligibility for a security clearance is granted. Statement of the Case On March 24, 2021, the Department of Defense (DOD) issued a Statement of Reasons (SOR, Item 1) to Applicant detailing security concerns under Guideline F (financial considerations). The action was taken under Executive Order (Exec. Or.) 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; DOD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG), implemented by DOD on June 8, 2017. Applicant elected in her response to the SOR (Answer, Item 2) to have her case decided on the written record in lieu of a hearing. The Government submitted its written case on July 29, 2021. A complete copy of the file of relevant material (FORM) was

provided to Applicant, who was afforded an opportunity to file objections and submit material to refute, extenuate, or mitigate the security concerns. Applicant received the FORM on September 14, 2021. She did not respond to the Government’s FORM. The case was assigned to me on December 2, 2021. The Government’s documents, identified as Items 1 through 5, are admitted in evidence without objection.

FINDINGS OF FACT

Applicant admitted all of the SOR allegations in her Answer. She is 50 years old. She is married and she has seven children--five adults and two minors--and six step- children--all adults. (Items 1, 2) Applicant graduated from high school in 1990. She worked for ten years, from November 2008 to June 2018, as a cook and teacher’s aide in state A. She then worked as a part-time auction driver from July to September 2018, in state B. She has worked as a maintenance person since October 2018 in state C, and she has worked in that capacity for her employer, a DOD contractor, since May 2020. She has never held a security clearance. (Item 3) The SOR alleged that Applicant had 10 delinquent consumer debts totaling $26,628 (SOR ¶¶ 1.a - 1.b, 1.d - 1.f, 1.h - 1.l) and two delinquent medical debts totaling $2,387 (SOR ¶¶ 1.c, 1.g). In addition to her admissions in her Answer, Applicant disclosed her delinquent debts on her June 2020 security clearance application (SCA). She also discussed her delinquent debts during her July 2020 background interview. A July 2020 credit bureau report lists all of Applicant’s delinquent debts. (Items 1-5) Applicant attributes her delinquent debts to the high cost of living and minimal income she and her spouse earned in state A, where she was born and lived with her family until 2018. During that time, her spouse, at times, was an unreliable source of income because he was “in and out of [treatment] programs and facilities.” She also indicated that she did not receive financial help from her older children’s fathers. In 2018, Applicant and her spouse moved their family to state B for a better life, but Applicant was only able to find part-time employment, as discussed above. They then moved to state C, where she secured full-time employment and earned more than when she was employed in state A. She attempted to resolve her delinquent debts while maintaining steady employment in state C, but the credit union through which she applied for a debt consolidation loan denied her based on her negative credit history. (Items 2, 3, 4) SOR ¶ 1.a is for a $9,388 outstanding balance on an auto loan after Applicant’s car was repossessed in approximately 2017 or 2018. Applicant provided documentation with her Answer reflecting that she was resolving this debt through the Freedom Debt Relief (FDR) program. (Items 1, 2, 3, 4, 5) SOR ¶ 1.bis for a $10,370 charged-off auto loan. Applicant purchased this car with her spouse in 2014. The car began having issues and was repossessed in 2015.

Applicant stated in her Answer that she planned on enrolling this debt with the FDR program, but she was still retrieving information necessary for her to do so. (Items 1, 2, 3, 4, 5) SOR ¶¶ 1.cand 1.gare for two medical accounts placed for collection for $1,455 and $932, respectively. Applicant indicated during her background interview that she incurred SOR ¶ 1.cin 2019, when she received medical treatment after she took her niece to the hospital and passed out in the hospital lobby. Applicant provided documentation with her Answer reflecting that she was resolving SOR ¶ 1.cthrough the FDR program. She also stated in her Answer that she intended to enroll SOR ¶ 1.gin her FDR program, but she was still retrieving information necessary for her to do so. (Items 1, 2, 3, 4, 5) SOR ¶ 1.dis for a $1,374 charged-off credit card. Applicant provided documentation with her Answer reflecting that she was resolving this debt through the FDR program, who negotiated a settlement of $619 on her behalf and through which payments had been made. (Items 1, 2, 3, 4, 5) SOR ¶ 1.e is for a $1,258 collection account. Applicant provided documentation with her Answer reflecting that she was resolving this debt through the FDR program. (Items 1, 2, 3, 4, 5) SOR ¶ 1.fis for a $965 collection account. Applicant provided documentation with her Answer reflecting that she was resolving this debt through the FDR program. (Items 1, 2, 3, 4, 5) SOR ¶ 1.his for a $782 charged-off credit card. Applicant provided documentation with her Answer reflecting that she was resolving this debt through the FDR program, who negotiated a settlement of $313 on her behalf and through which payments had been made. (Items 1, 2, 3, 4, 5) SOR ¶ 1.i is for a $717 charged-off credit card. Applicant provided documentation with her Answer reflecting that she was resolving this debt through the FDR program, who negotiated a settlement of $287 on her behalf and through which payments had been made. (Items 1, 2, 3, 4, 5) SOR ¶ 1.jis for a $230 charged-off account that Applicant used for various catalog purchases. Applicant indicated during her background interview that she had been making monthly payments to resolve this debt. Applicant stated in her Answer that she planned on enrolling this debt with the FDR program, but she was still retrieving information necessary for her to do so. (Items 1, 2, 3, 4, 5) SOR ¶ 1.kis for a $931 charged-off account. Applicant indicated in her SCA and during her background interview that this was a credit account, and it was a duplicate of SOR ¶ 1.g. She did not provide corroborating documentation. Applicant stated in her

Answer that she planned on enrolling this debt with the FDR program, but she was still retrieving information necessary for her to do so. (Items 1, 2, 3, 5) SOR ¶ 1.lis for a $613 charged-off retail credit account. Applicant used this account for catalog purchases. Applicant stated in her Answer that she planned on enrolling this debt with the FDR program, but she was still retrieving information necessary for her to do so. (Items 1, 2, 3, 4, 5) Applicant provided documentation with her Answer reflecting that, as of April 2021, she had been enrolled in the FDR program since October 2020-- six months before the SOR. She was scheduled to make bi-weekly payments of approximately $231 for 24 to 48 months; she has made payments into the program totaling $2,797; and, she had 13 accounts in the FDR program, 7 of which had been settled. She acknowledged in her SCA that her credit was “very poor,” but she felt that she and her spouse had “a fighting chance to actually change our financial [outlook] and clean up our debts so we can try to purchase a home.” She indicated during her background interview that she intended to resolve all of her delinquent debts and become financially responsible. She stated in her Answer that moving to state C has given her the potential to make a better life for herself and her family. Applicant’s manager described her as a valuable asset to the company. The director of operations described her as a dedicated and trusted member of the team. (Items 2, 3, 4)

POLICIES

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines. In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are used in evaluating an applicant’s eligibility for access to classified information. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, these guidelines are applied in conjunction with the factors listed in the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶ 2(a), the entire process is a conscientious scrutiny of a number of variables known as the “whole-person concept.” The administrative judge must consider all available, reliable information about the person, past and present, favorable and unfavorable, in making a decision. The protection of the national security is the paramount consideration. AG ¶ 2(b) requires that “[a]ny doubt concerning personnel being considered for access to classified information will be resolved in favor of the national security.” In reaching this decision, I have drawn only those conclusions that are reasonable, logical, and based on the evidence contained in the record.

Under Directive ¶ E3.1.14, the Government must present evidence to establish controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, an “applicant is responsible for presenting witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by applicant or proven by Department Counsel, and has the ultimate burden of persuasion to obtain a favorable security decision.” A person who seeks access to classified information enters into a fiduciary relationship with the Government predicated upon trust and confidence. This relationship transcends normal duty hours and endures throughout off-duty hours. The Government reposes a high degree of trust and confidence in individuals to whom it grants access to classified information. Decisions include, by necessity, consideration of the possible risk that an applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation as to potential, rather than actual, risk of compromise of classified information. Section 7 of Exec. Or. 10865 provides that decisions shall be “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” See also Exec. Or. 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information).

ANALYSIS

Guideline F, Financial Considerations AG ¶ 18 expresses the security concern pertaining to financial considerations: Failure to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual’s reliability, trustworthiness, and ability to protect classified or sensitive information. Financial distress can also be caused or exacerbated by, and thus can be a possible indicator of, other issues of personnel security concern such as excessive gambling, mental health conditions, substance misuse, or alcohol abuse or dependence. An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds. Affluence that cannot be explained by known sources of income is also a security concern insofar as it may result from criminal activity, including espionage. AG ¶ 19 describes conditions that could raise a security concern and may be disqualifying. AG ¶ 19(a), an “inability to satisfy debts” and AG ¶ 19(c), “a history of not meeting financial obligations” apply. Applicant was unable to pay her debts accumulated over several years.

I have considered all of the mitigating conditions under AG ¶ 20 and find the following relevant: (a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur and does not cast doubt on the individual’s current reliability, trustworthiness, or good judgment; (b) the conditions that resulted in the financial problem were largely beyond the person’s control (e.g., loss of employment, a business downturn, unexpected medical emergency, a death, divorce or separation, clear victimization by predatory lending practices, or identity theft), and the individual acted responsibly under the circumstances; and, (d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts. Conditions beyond Applicant’s control, as previously discussed, contributed to her financial problems. For the full application of AG ¶ 20(b), Applicant must have acted responsibly under her circumstances. As previously discussed, Applicant provided documentation of her efforts to resolve her delinquent debts through the FDR program, which she enrolled in before the SOR. A security clearance adjudication is an evaluation of an individual’s judgment, reliability, and trustworthiness. It is not a debt- collection procedure. ISCR Case No. 09-02160 (App. Bd. Jun. 21, 2010). The adjudicative guidelines do not require that an individual make payments on all delinquent debts simultaneously, pay the debts alleged in the SOR first, or establish resolution of every debt alleged in the SOR. He or she need only establish a plan to resolve financial problems and take significant actions to implement the plan. See ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008). I find that AG ¶¶ 20(a) 20(b), and 20(d) are established.

WHOLE PERSON CONCEPT

Under the whole-person concept, the administrative judge must evaluate an applicant’s eligibility for a security clearance by considering the totality of the applicant’s conduct and all the circumstances. The administrative judge should consider the nine adjudicative process factors listed at AG ¶ 2(d): (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct, to include knowledgeable participation; (3) the frequency and recency of the conduct; (4) the individual’s age and maturity at the time of the conduct; (5) the extent to which participation is voluntary; (6) the presence or absence of rehabilitation and other permanent behavioral changes; (7) the motivation for the conduct; (8) the potential for pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or recurrence.

_____________________________ Under AG ¶ 2(c), the ultimate determination of whether to grant eligibility for a security clearance must be an overall commonsense judgment based upon careful consideration of the guidelines and the whole-person concept. I considered the potentially disqualifying and mitigating conditions in light of all the facts and circumstances surrounding this case. Overall, the record evidence leaves me without questions or doubts about Applicant’s eligibility and suitability for a security clearance. For all these reasons, I conclude that Applicant has mitigated the financial considerations security concerns.

FORMAL FINDINGS

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by section E3.1.25 of Enclosure 3 of the Directive, are: Paragraph 1, Guideline F: FOR APPLICANT Subparagraphs 1.a - 1.l: For Applicant

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is clearly consistent with the interests of national security to grant Applicant’s eligibility for a security clearance. Eligibility for access to classified information is granted. Candace Le’i Garcia Administrative Judge